Archive for August, 2011

EU Referendum hits two nails on the head
August 17, 2011

First, Richard North writes of the effects of “calculated and incessant propaganda”. His starting point is a paragraph or two in William Shirer’s Rise and Fall of the Third Reich. And whilst the UK may not be totalitarian, government there as here in South Australia (and Australia generally) puts forth a constant stream of “calculated and incessant propaganda”, happily presented by a largely uncritical media, not least the ABC and SBS, latterly providing an hour of Al Jazeera on Sunday afternoon (when might we expect an Israeli programme?). Australian commercial media often seem to endeavour to outdo their governmental relatives.

And speaking of uncritical media, how many have noticed the expense and impracticality of wind power, “The fantasy of wind”. Dr. North noted, in short:

Robert Bryce, senior fellow at the Manhattan Institute, writes on the “wind myth“. Texas, he says, has 10GW of installed wind-generation capacity – nearly three times as much as any other state. But during three sweltering days last week, when the state set new records for electricity demand, this “vast herd of turbines” proved incapable of producing any serious amount of power.

As with so much else we notice here the delusional stupidity and overweening arrogance of contemporary government, whether it has to do with climate change (apd), economic conditions and money or local government or . . . name your own source of poison.

It’s difficult to distinguish between lying and expressions of delusion but presumably the lie tends to depend upon a delusion, some divorce from reality and builds on that small or large point all the while manipulating language to serve. Hence that constant stream of “calculated and incessant propaganda”.

A week ago Melanie Phillips told of “How the liberals ruined Britain”:

The married two-parent family, educational meritocracy, punishment of criminals, national identity, enforcement of the drugs laws and many more fundamental conventions were all smashed by a liberal intelligentsia hell-bent on a revolutionary transformation of society. . . .

The result is fatherless boys who are consumed by an existential rage and desperate emotional need, and who take out the damage done to them by lashing out from infancy at everyone around them.

There is a sense in which this “existential rage” and perhaps similar “desperate emotional need” extends way beyond the children and young people who engaged in looting and wanton destruction of property and livelihoods in London and elsewhere last week.

Elections, today, have one primary characteristic: bribery based upon delusion. An election is now but one expression of the great cargo cult of the West in its decline. All we have now is underpinned by a sinking sand of debt, $55trillion in the US alone. The linkages between economic fantasy, “existential rage” and intellectual and moral lassitude, and in some peculiar manner secularization are extremely difficult to define let alone construct historically.

People have sometime known in the past, that they have behaved foolishly, usually by engaging in some form of speculation thus bringing ruin to their households. Guilty men sought to rebuild personal morale. Notwithstanding that it was not the author’s intention, this became evident in the course of reading The Revival of 1857–58: Interpreting an American Religious Awakening,by Kathryn Teresa Long (New York: Oxford University Press, 1998). It may be that we no longer have that capacity. That, too, may represent some part of the “existential rage” and “calculated and incessant propaganda” defining so much of our world today.

 

 

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“The law is a ass”
August 12, 2011

Mr. Bumble lived in somewhat different times, to the extent that he lived at all. Later, at the time of the republic referendum in Oz, someone remarked that a more important issue was having government obey the law. He was right. And with the government monopoly of telecommunications now under construction we read the following in The Australian today:

New NBN powers let rollout bypass planning laws

The NBN Co would be given sweeping powers to bypass state and local laws and install broadband infrastructure without the consent of landowners under government proposals that the opposition warns could allow it to override the wishes of local communities and string more overhead fibre from telegraph poles. . . .

Under plans released yesterday, the NBN Co and operators of any similar superfast broadband networks would be able to bypass state planning laws to connect premises and lay new broadband infrastructure in streets.

It gets worse:

Under an $11bn deal with the NBN Co and government, Telstra will be paid to transfer its customers to the new fibre network as its expansive copper network is decommissioned.

The assumption here is that Telstra’s customers will be able to afford to deal with NBN Co and its agents (internet service providers) such as Internode. On top of the several thousand dollars connection fee and another $150 per  month it’s not looking likely. That the Australian parliament, supported by Australian business, has condoned this wickedness makes a laughing stock of all its electoral propaganda and brings the institution into disrepute (assuming it’s not already there).

Update: Mish’s GETA tells further of the deepening democratic deficit in Europe:

Germany Proposes Stability Council with “Crack the Whip” Power to Impose Sanctions on Countries Lacking Fiscal Discipline, Pro-Business Labor Policies

No taxation without representation: no more.

 

Fiscal Austerity
August 11, 2011

Ever wondered what the term means? typed into Google it gives “About 1,400,00 results” in 0.35 seconds.

Top of the list is Wikipedia:

In economics, austerity is a policy of deficit-cutting, lower spending, and a reduction in the amount of benefits and public services provided. Austerity policies are often used by governments to reduce their deficit spending while sometimes coupled with increases in taxes to pay back creditors to reduce debt. “Austerity” was named the word of the year by Merriam-Webster in 2010.

There is much else besides, some interesting, some incomprehensible, some foolish. Of the latter, this gem is perhaps without peer:

some European experts have argued that, due to budgetary shortcomings, the year 2011 could mark the end of an era of government engagement in the economy started with the New Deal in 1933 that saw a massive deployment of public resources and the advancement of state ownership across (formerly private) industries and infrastructures throughout the Western world. . . .

If the American or British instances are any guide, shrinking government is a non-starter. Greece, Portugal and Ireland have begun to shrink but only under the duress of the EU financial authorities. Only Ireland has much chance of financial integrity and that owing to its unusual array of exports, particularly pharmaceutical products, as well as recently reduced interest rate on its loans from the EU.

In the British instance borrowing continues at around £3bn per week. The Australian government, overseeing an unemployment rate of (now) 5.1 per cent continues to borrow at a rate of $Aus50bn for the current financial year (1911–12).

Geoff Riley, some time Head of Economics at Eton College, on An A Level Economics Blog, tuto2u, writes:

Fiscal austerity is a term in common use in the media at the moment. It refers to decisions by a government to reduce the amount of government borrowing (i.e. cut the size of a fiscal deficit) over a period of years. Fiscal austerity normally involves a combination of measures including increases in the overall burden of taxation and cuts in either the real level or growth of government spending on state-provided goods and services.

He then offers several arguments for and against current UK policy, for some invoking the sacred name, Keynes.

Nouriel Roubini in The Financial Times, remarked a few days ago:

Until last year policymakers could always produce a new rabbit from their hat to trigger asset reflation and economic recovery. Zero policy rates, QE1, QE2, credit easing, fiscal stimulus, ring-fencing, liquidity provision to the tune of trillions of dollars and bailing out banks and financial institutions – all have been tried. But now we have run out of rabbits to reveal.

Roubini declined the self-evident invitation to say that not only had “all been tried” but that all had failed. That, evidently, was a logic too far. On the contrary, he argues:

The best bet is for those countries that have not lost market access – the US, UK, Japan, and Germany – to introduce new short-term fiscal stimulus while committing to medium-term fiscal austerity.

The definition of insanity for Albert Einstein was this: “doing the same thing over and over again and expecting different results.” Groucho Marx once remarked: “I have learned from my mistakes. Now I can repeat them perfectly.”

So it is with economists, journalists, commentators and the governments that have bought the Keynesian fantasy of seeming to produce something from nothing. The only austerity about all of them, a handful of honorable persons excepted, is their economy with the truth.

Someone once remarked that the truth with set you free. Yeah, right. Electoral disaster more like.

 

Poms fouled their own nest
August 10, 2011

The nearest to illuminating comment on the British “riots” (risible notion, also here) is from EU Referendum (longer post here). It helps reveal some of the cant and humbug flowing freely the greatly disturbed. Simon Jenkins in the Guardian conveniently overlooks one of the very real powers of local government authorities to wreck families in legal and public silence, something Christopher Booker has endeavoured to report over many years (see here, here, and here for just the most recent examples).

There was also somewhere, possibly from Ambrose, the proper complaint that the excitements found in various parts (then of London, latterly beyond the capital) were very small beer compared with the (probably irredeemable) irresponsibility of EU  and EMU authorities playing God with the lives of many, many millions of folk in the name of a totalitarian ideology.

Perhaps it’s the raw though hardly naive combination of open hostility and cavernous candor, hiding nothing, deceiving no-one, that draws us towards the heart of this darkness. It makes for stark contrast with the perpetual lying propaganda of political and governmental authorities and media. Stock markets in recent days, for example, have fallen rapidly for good reason. A ‘rumour’ —

Fund managers say the dramatic mid-afternoon rally was sparked by a rumour that the US Federal Reserve will announce another round of quantitative easing when it meets tonight in a bid to stop the financial market slide turning into an economic slump —

in the Oz instance reverses that. Absurd.

And that absurdity deepens with the bulk of news reporting, not least from the ABC. “Conservative” practice and “conservatives” as persons warrant only condemnation. I heard Malcolm Turnbull the other day effectively  spitting the term in regard to consumer caution. (Comparable with Hugh MacKay’s condemnation of irrational consumers on Radio National the previous week.) And, only “conservatives” have caused the US a problem of fiscal deficit. Better, like British social workers and family destruction, to have silence on the matter.

Hooligans won’t rule. Yet the all too typically unhelpful definition (per COD), “a young ruffian, esp. a member of a gang” points in the right direction. Thus “ruffian”: “violent, lawless person”. That’s better and brings us closer to the modern, softly (and often not so softly) despotic and parasitic state, democratic in name only.

 

 

Yet another last gasp!
August 8, 2011

Aged care tends to be surprisingly contentious. One hears occasional horror stories. Late last year, we were warned off one establishment that apparently had begun to fail in its duties of care. Since then we have had nothing but admiration for the establishment in which my mother resides.

We are also members of a generation that thinks money just grows on trees. You want some? Just pluck away. Hence the imbecility of government economic policies of recent years, not least the monster, when not plain ludicrous, fraud of economic stimulus. Now comes a fresh statement of greed.

Radical new plan for aged-care funding would save family home

shouts the banner headline in The Australian. The crux of it, naturally, is vastly greater burdens placed upon taxpayers, already not a very happy bunch.

FIRE sales of the family home to pay huge accommodation bonds for residential aged-care places would be a thing of the past under a radical new blueprint for Australia’s aged-care sector.

Older people would instead be able to use equity from their own home to fund an aged-care place through a form of government-backed reverse mortgage, the Productivity Commission proposes.

In its report to the Gillard government, Caring for Older Australians, the commission calls for the family home to be counted in calculating a person’s wealth, to determine their capacity to contribute to their own aged care.

The rich would be required to contribute up to 25 per cent of the costs of their aged-care services – items such as help with showering and toileting as well as house cleaning and shopping – to a lifetime cap of $60,000. However, the government would continue to fund about 85 per cent of aged-care costs.

Given the contents of the third paragraph, what changes? Indeed, why should it? One reason: greed. The final quoted sentence probably warrants closer attention: is it talking of low-care residential care or something else? And before all that, isn’t “family home” something of an oxymoron when so few families remain constant? And that, too, a condition to which Australian governments have made a substantial contribution.

 

 

“laudable intentions”
August 8, 2011

So often one comes across this or a parallel phrase, “good intentions”, of equal dishonesty. Just the latest is The Australian‘s news regarding a government report telling of monstrous failures of policy. Well, apparently not of policy but of “policy delivery”. That is, blame someone else. Labor government policy could hardly be wrong, could it?

Other examples flood the pages of Dambisa Moyo’s,  How the West Was Lost: Fifty Years of Economic Folly–and the Stark Choices Ahead, and occur periodically in Charles Massy, Breaking the Sheep’s Back. University of Queensland Press, 2011.

One feature of both these highly lauded volumes is the sheer difficulty of writing history. Clearly, neither author has experience of the pertinent training or their editors at their publishers reckoned the time required for serious editorial labour was neither required nor likely to return a profit. Should either of these books, essentially possessing a historical argument, and likewise the bureaucracy’s report into itself, have approached not only their sources critically but also their own premises of argument, then each might have had more to offer the reader. Moyo’s dependence upon straw men, in particular, is unacceptable. Massey simply fails to reconstruct the past systematically, constantly repeating the argument to come and, frankly, with each chapter making the next chapter irrelevant. And this from an academic press!

The pest is both volumes have valuable things to say. The essence of Moyo’s argument regarding debt in the West is perfectly sound; Massy, too, regarding rent-seeking. My quarrel is with the quality of reconstruction. And that is all too typical of contemporary journalism and commentary. Too much is too little known and method and language largely dismissed as being beside the point.

A splendid contrast is  Richard Pipes, The Degaev Affair: Terror and Treason in Tsarist Russia. Yale University Press, 2005. For history, this is the genuine article. Only a small book but one that abounds with learning gathered through Pipe’s remarkable experience as a historian. So, why are the endnotes a mess? We just can’t win can we?

Back we go to where we started: “laudable intentions”. No. Lazy? Yes.

 

The writing’s on the wall . . . assuming the builder’s viable
August 4, 2011

Still doubting the inherent foolishness of neo-Keynesian fiscal deficit stimulus? This statement from Peter Jones, chief economist of Master Builders Australia, should prove definitive (ht: Mish’s GETA):

The recent MBA June quarter 2011 national survey found builders were “increasingly concerned about whether there will be a revival in private sector demand in time to fill the gap being left as Building the Education Revolution, Social Housing and other government stimulus programs are completed.”

Stimulus? No, just series after series of one-off electoral bribes, dressed in apparently unquestionable pieties such as “education”, in which professional economists and others willingly joined. Well, it’s over now and that’s just the beginning.

The future has begun
August 3, 2011

At lat, a mainstream news organisatin that gets US debt levels right. AFP reports:

US debt shot up $238 billion to reach 100 percent of gross domestic project after the government’s debt ceiling was lifted, Treasury figures showed Wednesday.

Treasury borrowing jumped Tuesday, the data showed, immediately after President Barack Obama signed into law an increase in the debt ceiling as the country’s spending commitments reached a breaking point and it threatened to default on its debt.

The new borrowing took total public debt to $14.58 trillion, over end-2010 GDP of $14.53 trillion, and putting it in a league with highly indebted countries like Italy and Belgium.

Public debt subject to the official debt limit — a slightly tighter definition — was $14.53 trillion as of the end of Tuesday, rising from the previous official cap of $14.29 trillion a day earlier.

Add to that Ambrose’s less than cheery outlook:

The West’s horrible fiscal choice

The US, Britain, and Europe are together embarking on a sudden and severe tightening of fiscal policy, in unison, before economic recovery has reached safe take-off speed. The experiment was last tried in the 1930s.

Yet somewhat contrary to A E-P’s consistently presented argument (which has continued for many months), he overlooks the unattractive reality of no less persistent bad governance. Neo-Keynesian deficit spending has, unremarkably, failed. And as Albert Einstein once remarked:

“Insanity: doing the same thing over and over again and expecting different results.”

The outlook is, frankly, dreadful. (Forget China.) To date I have been surprised by the relative passivity of the southern European publics at the straits into which governments aided by a ludicrous media have led them. The analysis offered, at least in part in Kenneth Minogue’s  The Servile Mind: How Democracy Erodes the Moral Life, is discouraging. Debt and much else has proven to be a truly faustian bargain.  How the West Was Lost: Fifty Years of Economic Folly–and the Stark Choices Ahead, by Dambisa Moyo barely scrapes the surface. The essential argument is right but the means chosen to prove it are most unsatisfactory. Add to these a widespread culture of death and the great scam of climate change (apd). Messy.

It’s over twenty years since National Interest published Francis Fukuyama’s “The End of History” (see here).

A true global culture has emerged, centering around technologically driven economic growth and the capitalist social relations necessary to produce and sustain it.

Oops. Still, look on the bright side, lots of work for future historians!

 

 

Clarity, anyone?
August 1, 2011

One could ask that of many public questions. The choice here is US government public debt. Why is it that many commentators that one reads or hears claim that it is now around 70 per cent of US GPD?

Wikipedia has much merit even as one must cast a very critical eye over much that appears there. On this subject it seems pretty much accurate (see also here):

As of June 29, 2011, the Total Public Debt Outstanding was $14.46 trillion and was approximately 98.6% of calendar year 2010’s annual gross domestic product (GDP) of $14.66 trillion.

There are those who hold that the US public debt (and this ignores the states and local government, whose own debt threatens, when it has not already realised, bankruptcy) is not a matter of comparison with government debt Greece and the like. I take it they exclude from their calculations:

Intragovernmental Holdings, representing U.S. Treasury securities held in accounts which are administered by the federal government, such as the OASI Trust fund administered by the Social Security Administration . . .

Yet these do not represent, as it were, any form of cash in hand. They are an aspect of government debt.

That said, it also seems that the players in the congressional drama have little or no intention of approaching their nation’s financial problems with any seriousness. For some, various programs are sacrosanct: they might be medicare and social security, or perhaps defence: the one likely to bankrupt them over time, another a sewer of financial irregularity. Some would tax the “rich” more, some appear to ignore anomalies of corporate taxation (GE comes to mind). Whichever it might be, performances appear calculated upon the limits of a deracinated public. Frivolity reigns.